By Pete Julius

For many years the automotive industry was dominated by General Motors, Chrysler and Ford, all based in Detroit, Michigan.  Today, the industry is quite different.  Three companies no longer dominate the industry and it does not solely exist one region.  Of the Big Three, only General Motors and Ford remain completely U.S. owned.   Additionally, these two companies own significant stakes in numerous foreign owned automotive companies.  Globalization has been one of the major catalysts behind the revitalization of this humongous industry. 

Over the past few decades, US based companies began establishing new operations on foreign soil, namely Mexico and Canada.  Even more recently, many automakers have begun to set up shop in the southeastern part of the United States.  DaimlerChrysler, Hyndai, BMW and Honda have all made major investments in this region over the past several years.  Is the Midwest losing its crown as the automotive capital?  Not exactly.  Despite all of the most recent publications of substantial investments by many major automakers, the Midwest still seems to be the dominating region.  As the table below points out, a large portion of new and expanded announcements still occur in the Midwest.     

 Top Ten New & Expanded Announcements In the Automotive Industry by State

(January 1999 to September 2002)

 

Number of Announcements State Avg. Investment ($M) Average Employed Average SQ FT (1,000’s)
776 Michigan $28.1 48 35
177 Ohio $21.7 45 38
109 Kentucky $12.3 72 44
99 Indiana $32.0 121 45
95 California $2.9 50 79
82 North Carolina $9.3 35 33
71 Illinois $20.5 55 117
64 South Carolina $23.6 112 32
57 Alabama $67.0 187 28
53 Texas $9.7 156 101

 

 

 

 

 

Source: Conway Data Scoreboard & Whittaker Associates, Inc.

Michigan, Ohio, Kentucky, and Indiana by far contain the most new and expanded announcements within the automotive industry.  In fact, five of the top ten states are Midwestern states.  However, in terms of average investment and employment the state of Alabama leads every other state with an average investment $67 million and an average employment of 187.  Regardless of media announcements focusing on major automotive investments in the southeast, the Midwest still looks to be dominating the industry.  These new and expanded facility announcements conclude that the automotive industry is not entirely driving away from its Midwest dominance.